Canada’s economy lost 2,800 jobs in July, but the unemployment rate stayed steady at 6.4 per cent, according to Statistics Canada. Job losses were mainly in wholesale and retail trade, which saw 44,000 positions cut, and in finance, insurance, real estate, and leasing, which lost 15,000 jobs. On the other hand, there were job gains in public administration, transportation, warehousing, and utilities.
The private sector saw a decrease of 42,000 employees in July, although overall private sector employment was up 0.6 per cent compared to the previous year. Meanwhile, the public sector added 41,000 jobs, with employment growth increasing by 4.8 per cent over the past year.
The unemployment rate also rose more for recent immigrants, with young immigrant workers being particularly affected. Their unemployment rate jumped to 22.8 per cent in July, up by 8.6 percentage points from a year ago.
Some businesses have blamed high interest rates for the lack of job creation, but it’s also noted that other factors, like government policies on population growth and labour force integration, are important.
Economists had expected the unemployment rate to rise due to the labour market’s struggle to keep up with rapid population growth. Average hourly wages increased by 5.2 per cent, or $1.73, reaching an average of $34.97 in July, which is a rate that concerns the Bank of Canada.
Although there were weak spots in the jobs report, some areas showed strength, leading experts to view the report as not having a significant impact on the Bank of Canada’s policies. However, the lack of job growth over the past two months and the challenging summer job market for students suggest there may be a case for future rate cuts, but not urgently.
